Posts tagged photovoltaic

Home and business owners in New Jersey and other leading solar energy states can look forward to yet another drop in pricing for photovoltaic systems in 2010.

PV systems have been increasing in number as the benefits and incentives become available to home and business owners. However, although the rate of growth has been tremendous over the past ten years, it has been constrained by the shortage of manufacturing capacity for purified polysilicon. This material is what makes up the semiconductor chips in PV systems, and in 2006, for the first time, over 50% of the world’s polysilicon was used to produce solar PV cells.

Supply shortages have forced many manufacturers to develop ways to use polysilicon more efficiently. New technology that does not depend on purified silicon allows thin film cells and amorphous silicon to be used instead, reducing overall costs. Thin film cells were initially not efficient enough to compete with conventional cells, but have been redesigned to make PV panels cheaper to manufacture.

In 2008, polysilicon supply to the solar industry grew by 127% in megawatt terms. The US contributed substantially to this figure; over 43% of the world’s supplies came from the United States.

For New Jersey, where alternative power is becoming the avenue more and more business owners are taking, PV costs continue to drop. Thanks to the reduction in cost for thin cell materials and the generous incentives offered by state and federal agencies, photovoltaic systems can now be installed with small upfront investments, and be completely paid off in short order (recent projections showed that a business installing a 40+ kw system could be free and clear in less than five years.

“The average price for a PV module, excluding installation and other system costs, has dropped from almost $100 per watt in 1975 to less than $4 per watt at the end of 2006. With expanding polysilicon supplies, average PV prices are projected to drop to $2 per watt in 2010.

For thin-film PV alone, production costs are expected to reach $1 per watt in 2010, at which point solar PV will become competitive with coal-fired electricity. With concerns about rising oil prices and climate change spawning political momentum for renewable energy, solar electricity is poised to take a prominent position in the global energy economy.” *

With New Jersey, California and other heavy alternative energy states causing PV installations to double and triple over the last five years, the US is poised to take the lead in the race for the most solar power produced. Costs continues to be an issue, but new grants from the federal government make initial setup a viable investment for many – and more financial relief is on the way.

In 2005, it was predicted that the solar industry would see a rapid decline in costs by 2010, making PV a mainstream power option. *

Global production of solar photovoltaic (PV) cells doubled almost twice between 2000 and 2005, and grew an additional 41 percent in 2006 alone. Grid-connected solar capacity provides less than 1 percent of the world’s electricity, but this figure is set for rapid expansions as the US surges to the forefront making PV easier and more cost effective to obtain.

US federal incentives, loans and grants along with state funded rebates for homeowners and businesses which install photovoltaic systems have boosted the country’s move towards alternative energy sources, with states like New Jersey leading the way.

Those who install photovoltaic systems can now see their costs cut up front by both loans and tax breaks, allowing them to set up systems with little cost up front. Solar Renewable Energy Certificates, or SRECs, can further defray the cost, paying down the loans and providing a free and clear system in less than five years in some cases.

At that point the SRECs become a source of income (they trade on the open market for prices ranging from $585 to nearly $700 in New Jersey) – plus electricity costs continue to be largely defrays be the energy output of the system. The benefit to business owners is tremendous – a one time investment can yield up to 20 years of service from a dependable PV system that actually earns money.

All of this has led to the rising number of business owners who opt to install PV systems, and the cost as defrayed by the many incentive programs has effectively dropped approximately 40% as detailed by the 2005 report.

(*Assessments made by the Worldwatch Institute in Washington, D.C., and the Prometheus Institute in Cambridge, Massachusetts).

Last November, New Jersey regulators approved a proposal from utility Public Service Electric and Gas to expand its solar loan program by $143 million and 51 megawatts. What does this mean to New Jersey home and business owners seeking to install photovoltaic systems to defray heating and electricity costs? A lot.

The program expansion brings the loan totals up to a projected $248 million, which means about 81 megawatts worth of solar systems have become available across the state. Even municipalities are getting in on the action, converting publick works such as streetlamps and city buildings over to solar power.

The first loan program approved by PSEG for installing photovoltaic panels kicked in back in April 2008. The program resulted in about $105 million in loans (30 megawatts worth of solar systems) being applied for. This new expansion falls under new regulations, and is expected to kick start another wave of interest in PV by residents of New Jersey.

The Solar Loan II Program is expected to run for 2 years or until an additional 51 in solar systems have been installed; people who apply for the loan can expect to have half the cost of a photovoltaic system installation covered. The 10-year loans for residential homeowners, and 15-year loans for commercial or municipal customers can be repaid in cash or via earned Solar Renewable Energy Certificates (SRECs).

According to GreenTech Media Research, the United States is closing in on the front runner position to head the global solar photovoltaic (PV) marketplace. The US is poised on the brink of growth explosion, and sales are expected to double by 2011.

German solar industry association BSW states that Germany is currently the largest solar PV market worldwide, but the report (titled ‘The United States PV Market Through 2013: Project Economics, Policy, Demand and Strategy’) indicates that the U.S. will sweep past Germany to take first place globally in the field of solar sales and installation.

The reason? US demand for solar has skyrocketed thanks to federal mandates, and is expected to keep growing, with a rise of about 50 percent, from 320 megawatts in 2008 to a projected 1,212 megawatts (1.2 gigawatts) in 2012. There is even the possibility of topping 2 gigawatts by that date if federal, state and regional incentives keep expanding.

California currently holds the title for US solar PV leadership, but rising solar PV demand puts other states (Arizona, New Jersey, New Mexico, New York, Nevada and Massachusetts) in play. These are expected to collectively support 376 megawatts of PV generated electricity by 2012.

The growth is expected to occur primarily in residential and utility-scale sectors. Investors are increasingly willing to support utility-scale solar as a reliable, long-term investment thanks to state renewable portfolio standards, or RPSs. These mandate higher limits of renewable energy in a utility’s generation mix. Utility or power companies unable to comply can make up the deficit by buying credits from residential and commercial owners of PV systems through SREC programs like the one available in New Jersey..

New Jersey offers solar renewable energy credits, or SRECs, for energy produced through PV. These trade in excess of $600 on the market, and cqan be purchased by private investors against rises in future value, or by power companies to help satisfy their alternative energy quotas.

In addition, the grants available to commercial installations make it easier for mom and pop stores to install and run PV systems – the average time to pay off a system is four years, and all SRECs generated after that time are pure profit.